China luring preclinical players

By Kirsty Barnes

- Last updated on GMT

Related tags Clinical trial China

China is one of the best destinations to outsource preclinical
work, delegates heard at this year's CPhI trade how in Milan.

"The preclinical challenge is having the right research models regarding the safety and protection of animals, but no matter how much care is taken by western labs, they are plagued by protest groups,"​ DA Prasanna, vice chairman & managing director of Manipal Acunova told Outsourcing-Pharma.com. "The Chinese scientific community has identified this as a niche area and the government has been working to provide an environment where these studies can be conducted to the satisfaction of global sponsors and regulatory bodies so that the country can become a leader in the field." ​ Toxicology studies are not easy to perform and so China's heavy focus in this area has meant that they have developed good experience in this field and do a good job, he added. The speed of studies conducted in China has also contributed to the country's appeal. In addition, the low cost base the country is able to offer is also a major draw card for those partaking in the high risk world of drug discovery. According to a recent report published by the UK Trade and Investment (UKTI) department, the local Chinese industry estimates that Phase I trials can be conducted in China for around 15 per cent of the equivalent cost in a Western country, while Phase II studies cost 20 per cent of the price in the west. Indeed, the country's emergence as a favourite destination for outsourcing drug development has been reflected in a flurry of activity in this field of late. In August China's Hutchison MediPharma,​ Chi-Med's R&D subsidiary, bagged a drug discovery and development agreement with drug heavy Eli Lilly.​ Together, the two firms will focused on drug targets in oncology and inflammation at Hutchinson's facilities in Shanghai. China's attractive cost base was a factor in Lilly's decision to partner with the firm. Although detailed financial terms were not disclosed, Hutchison will receive an upfront payment, annual R&D support fees, along with milestone payments of up to $20m (€14.2m)-$29m per candidate at certain time-points and potential royalties on worldwide sales of any commercialised products. Hutchison will also have the option to take control of any candidates that Lilly rejects. In July WuXi PharmaTech, the biggest Chinese contract research organisation (CRO) announced an initial public offering (IPO) on the New York Stock Exchange. Most of the firm's total net revenues over the last three years were generated from sales to customers located in the US. The Shanghai-based CRO, which specialises in preclinical laboratory testing services, said it would use $40m of the proceeds to build a preclinical drug safety evaluation centre in Suzhou, another $40m to expand its Jinshan facility, and the balance for "general corporate purposes".​ In March, preclinical bigwig Charles River Laboratories established a presence in China by signing a joint venture deal with Shanghai BioExplorer, a Chinese preclinical services provider. The company said this is the first phase of an expansion programme in Asia, designed to support growing demand in this booming market. "We expect demand for both research models and preclinical services in Asia to significantly increase over the next several years as pharmaceutical and biotechnology companies expand their research efforts in this market, and we intend to play a leading role in this emerging opportunity,"​ said James Foster, chairman, president, and CEO of Charles River.

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